Re: Confidence: A Basic Politics Puzzle

Eric Watt Forste (
Mon, 24 Feb 1997 12:15:49 -0800

Mark Grant writes:
>Suppose I'm an employee of "Joe's Protection Agency, Inc" and happen
>to see two guys fighting down an alleyway... how do I know whether
>to intervene if I don't know whether either of them are clients of
>my agency? I could break up the fight and then ask for membership
>cards, but if neither are members I've wasted my time and risked
>harm for no reason.

Reciprocity agreements? I remember they used to have a problem with
private fire-insurance companies slugging it out with one another for
the right to put out a fire in an uninsured home, figuring they could
manage to collect something later. (Incidents like these were used in
arguments for municipalization of the fire departments, or so I've
heard.) But it seems to me that reciprocity agreements worked out in
advance could narrow the problem down to the uninsured (or "outlaws").
Who would still present a problem in the situation you describe above.

But I think the best deterrent againt violent crime is having a
random distribution of 10% of the population trained and armed and
legally capable of defending themselves and their property. That
deterrent is presently being vigorously undermined in the United
States, and I doubt that either public law enforcement or PPA
contracts will do half as good a job.

>Are people assumed to protect themselves from that kind of thing
>and only call on the protection agency if the situation gets out
>of hand? This obviously works for crimes which are reported after
>the fact, but not if someone attacks me while I'm walking down the

Compare it to the system we have now. I've been attacked on the
street three times now in my life, and none of those times were
any public cops present. On one of those occasions I was assisted
by a private "Good Samaritan" who pulled up to the curb and frightened
away the muggers with his presence (ah, the power of a Fair Witness),
and never asked me for any payment. Just anecdotal evidence, but
I would be surprised if rigorous stats bore out the idea that public
cops actually perform much better than your worst-case scenarios
for PPAs. Of course, we don't have rigorous stats for PPA performance
yet, just theory and a little bit of real-old Icelandic and
Anglo-Saxon history.

>Or are protection agencies supposed to be location-based?

In my more moderate moods, I'm a Hayekian, and impressed by the
incredible tangle of externalities and public goods that develop
in a complex dense large city (such as San Francisco), and I'm not
all that averse to local governments contracting out for local
police services. (I still don't care for zoning decrees at *all*,
though.) The fact of the matter is that where I live, the problem
with law enforcement is not that it hasn't been fully privatized
and demonopolized, it's that they are wasting huge amounts of
resources on "vice" and traffic-stuff and not concentrating on
actual crime. Not to mention that the oppression of the persecution
for "vice" is one of the forces that turn people toward crime. It
makes the difference between a down-and-out person just turning to
drugs (bad outcome in a libertarian society) and a down-and-out
person turning to drugs *and* crime (bad outcome in my current

So much for vice. As for the traffic-stuff, I think the streets and
roads should be privatized.

Eric Watt Forste ++ ++